BRUSSELS, July 13 (Xinhua) -- The European Commission has given the green light to the Netherlands to provide state aid to the tune of 3.4 billion euros (3.87 billion U.S. dollars) to the country's flag carrier airline KLM, which has been hit hard by the COVID-19 pandemic.
The pandemic has grounded air travel in most countries, as governments took preventive measures to curb the spread of the coronavirus by shutting airports and banning non-essential travel.
KLM is part of the Air France-KLM Group, in which the Dutch state holds a stake. It is the Netherlands' second-largest private employer with over 36,600 employees.
State aid is generally not allowed in the European Union (EU), but a special temporary framework has been adopted for specific aid as a result of the coronavirus outbreak.
KLM, like many other airlines around the world, was hit hard by the pandemic and the imposition of travel restrictions by the Netherlands and many other destination countries, resulting in high operating losses.
Since the gradual easing of restrictive measures, as of the beginning of June 2020, air passenger traffic is slowly recovering, but the airline did not have enough liquidity to restart the post-pandemic business.
"KLM plays a key role for the Dutch economy in terms of employment and air connectivity, " said Margrethe Vestager, the European Commission's Executive Vice-President in charge of competition policy. "This 3.4-billion-euro state guarantee and state loan will provide KLM with the liquidity that it urgently needs to withstand the impact of the coronavirus outbreak." Enditem
